About 20,000 seniors in Massachusetts will be forced to find new health insurance plans after Blue Cross Blue Shield said it’s cutting back on its Medicare Advantage programs to stem financial losses.
“It’s a cost issue and it’s an inconvenience for my wife and I,” said Tom Stambaugh, 74, of Somerville, who said he will pay nearly three times as much for his health insurance next year as he has in 2026.
The state’s largest health insurer is discontinuing several Medicare Advantage plans, including the one Stambaugh is on, in 2027. Blue Cross is also severely limiting how many people can enroll in its remaining Medicare Advantage plans, which are part of the federal government’s insurance for seniors 65 and older, but operated by private insurance companies.
Blue Cross said the cutbacks came after the not-for-profit incurred $275 million in losses with the plans in 2024 and 2025.
“We are committed to Medicare Advantage. We are committed to seniors in Massachusetts,” said Sarah Iselin, chief executive of Blue Cross Blue Shield of Massachusetts. “However,” she added, “we are living through a moment where the cost of care to run the Medicare Advantage program has exceeded the premiums that we’re getting to administer the program from the federal government.”
Blue Cross is eliminating some plans in Middlesex, Essex, and Worcester counties. It’s also limiting the number of people who can enroll in its remaining Medicare Advantage plans, allowing very few new members to join on a first-come, first-served basis.
The insurance options being eliminated include both PPO and HMO plans. PPO plans tend to have higher premiums and out-of-pocket costs, but cover a wider range of providers. HMO plans are typically less expensive, but require members to see providers within the insurer’s network.
The insurer’s financial losses have made it “very challenging for us in some particular markets,” said Krista Bowers, Blue Cross’s senior vice president of government programs.
“We’ve had to make some tough choices for our members while protecting many, many members and not raising our premiums or lowering benefits for everyone across the board,” Bowers said.
Blue Cross isn’t alone in its retreat from Medicare Advantage, which has become wildly popular in recent decades. Other Massachusetts plans, including Mass General Brigham Health Plan, Point32Health, and Mass Advantage in Worcester County, have either trimmed back their plans or exited the market altogether. It’s a major shakeup for Medicare Advantage users, who nationally represent more than half of all Medicare-eligible beneficiaries.
Mass General Brigham Health Plan is terminating all its PPO plans within the program for 2027, while Point32Health, the parent company of Harvard Pilgrim Health Care and Tufts Health Plan, is ending one PPO plan. Mass Advantage, citing “significant changes in the Medicare landscape” in a notice on its website, is leaving Medicare Advantage altogether and subsequently shutting down.
It’s been a rough few years for health plans across the board, many of which reported record losses, especially after expensive GLP-1 weight loss drugs ballooned in popularity. But after significant cost-cutting — including offering buyouts to hundreds of employees in October of last year and ending coverage of GLP-1 medications for obesity — Blue Cross was back in the black for the first half of 2026. Premiums, however, are still expected to climb as other medical and pharmaceutical costs soar.
Blue Cross expects its reduced presence in the Medicare Advantage market to be temporary, with hopes of a rebound in 2028.
In the meantime, Stambaugh said he and his wife feel abandoned by Blue Cross. He looked into other Medicare Advantage options available in Middlesex County and found only a few, each far more expensive than his current plan.
He landed on Original Medicare, operated by the US government, but will have to purchase two supplemental plans to help cover copays and prescriptions.
His monthly total will come to $315 — a nearly 200 percent jump in one year.
For comparison, the state approved a 13-percent price increase for Blue Cross’s average premiums for non-Medicare Advantage plans sold on the Massachusetts Health Connector.
Sharon Kling, who lives in Sutton, faced a similar decision. The 74-year-old and her husband have been purchasing their Medicare Advantage plans from Blue Cross for about a decade and were happy with the coverage. Kling said she was shocked when her husband received a recent letter telling them their plan was being discontinued.
The couple researched alternatives that included their beloved primary care doctor. That whittled the Medicare Advantage options down to one, and the couple wasn’t happy with it. So, they’re switching to Original Medicare, too.
Kling said she’s nervous about the increase in administrative work that will happen when she’s no longer on a Medicare Advantage plan that wraps hospital and drug coverage into one product. She and her husband will need to enroll in a supplemental plan, known as Medigap, to help cover out-of-pocket costs.
“We’re going to get three different bills potentially between Medicare, Medigap, and prescriptions, and we’re going to have a couple different insurance numbers,” Kling said. “There’s some anxiety about that.”
Marin Wolf can be reached at marin.wolf@globe.com.